3. What Is Amazon Order Defect Rate (ODR)?
Order Defect Rate is the percentage of orders that have one or more indicators of poor customer service during the applicable measurement period.
Amazon identifies three main components of ODR:
- Negative seller feedback
- A-to-z Guarantee claims
- Credit card chargeback claims
Amazon expects sellers to maintain an ODR below 1%.
How is ODR calculated?
The basic formula is:
ODR = Number of orders with one or more defects ÷ Total orders in the measurement period × 100
For example:
Suppose a seller receives 500 orders during the relevant measurement period. Five orders have one or more qualifying defects.
ODR = (5 ÷ 500) × 100
ODR = 1%
This means the seller has reached the 1% threshold and needs to take corrective action to remain below Amazon's recommended limit.
What causes ODR to increase?
1. Negative seller feedback
Negative feedback can indicate problems with product quality, packaging, delivery experience, or customer service.
Examples include:
- Customer receives a damaged product.
- Product does not match its description.
- Package arrives with missing components.
- Customer has a poor experience with seller communication.
Amazon considers one- and two-star feedback negative for this metric.
2. A-to-z Guarantee claims
Customers may file an A-to-z Guarantee claim when they believe an order has not been fulfilled according to Amazon's requirements.
Common situations include:
- Product not received.
- Delivery-related disputes.
- Refund-related disputes.
- Product or order issues covered by the guarantee.
An eligible claim can affect ODR. Sellers should review the claim details and submit accurate evidence through the applicable Amazon process if they believe the claim is incorrect.
3. Credit card chargebacks
A chargeback occurs when a customer disputes a payment through their bank or card provider.
Chargebacks can become an ODR issue and should be investigated carefully.
How to reduce Amazon ODR
Follow these practical steps:
1. Improve product quality control
Inspect products before dispatch. Check for defects, missing accessories, incorrect variants, and damaged packaging.
2. Maintain accurate product listings
Your product images, title, specifications, size details, and description should accurately represent the item.
3. Improve packaging
Use suitable packaging to protect products during transportation. Fragile and sensitive products may require additional protection.
4. Respond to customer queries promptly
Monitor buyer messages and address genuine concerns professionally through Amazon-approved communication channels.
5. Investigate every negative feedback or claim
Look for recurring problems. If multiple customers report the same issue, identify the underlying cause instead of treating every complaint separately.
6. Dispute incorrect claims where appropriate
If you have valid evidence that a claim or feedback item is incorrect and eligible for review, use the appropriate Amazon dispute or removal process.
Do not request buyers to change or remove feedback in exchange for compensation or benefits.
4. What Is Amazon Late Shipment Rate (LSR)?
Late Shipment Rate measures the percentage of seller-fulfilled orders for which shipment confirmation is completed after the Estimated Ship Date (ESD).
It is important to understand that Late Shipment Rate applies to seller-fulfilled orders. It is not the same as a courier delivering a package late after the seller has correctly confirmed shipment.
Amazon measures this metric over 10-day and 30-day periods.
How is Late Shipment Rate calculated?
Late Shipment Rate = Orders confirmed shipped after the Estimated Ship Date ÷ Total orders in the measurement period × 100
Example:
Suppose a seller processes 200 seller-fulfilled orders. Eight orders are confirmed shipped after their expected ship dates.
LSR = (8 ÷ 200) × 100
LSR = 4%
This is above Amazon India's current general recommendation to keep the metric below 2%.
What causes a high Late Shipment Rate?
Common causes include:
- Orders are not packed on time.
- Staff are unavailable during peak order periods.
- Pickup scheduling is delayed.
- Products are listed with unrealistic handling times.
- Inventory is not physically available.
- Shipping confirmation is completed after the expected ship date.
- Orders are not processed on weekends or holidays according to the seller's operating schedule.
How to reduce Late Shipment Rate on Amazon
1. Process orders within the handling time
Check new orders regularly and prepare them according to the expected ship date.
2. Maintain accurate handling time
Set realistic handling times based on actual stock availability, packing capacity, and operating days.
3. Prepare orders before pickup
Keep parcels packed, labelled, and ready for the scheduled pickup.
4. Monitor Easy Ship pickups
For Amazon Easy Ship, follow the current pickup scheduling instructions and ensure packages are ready when the delivery partner arrives.
5. Maintain sufficient operational staff
During festive periods, major sales events, and high-order-volume days, plan additional packing and dispatch capacity.
6. Track shipment confirmation
Check that orders are confirmed shipped within the applicable timeline. Do not mark an order as shipped before it has actually been handed over according to Amazon's process.
7. Review delayed orders daily
Identify orders approaching their expected ship dates and prioritize them before the deadline.
5. What Is Amazon Cancellation Rate?
Amazon Cancellation Rate, also called Pre-Fulfilment Cancellation Rate, measures seller-fulfilled orders cancelled by the seller as a percentage of total orders during the applicable measurement period.
It also includes certain orders that Amazon automatically cancels because the seller does not ship and confirm the order within the applicable cancellation timeline.
Amazon measures this metric over 7-day and 30-day periods.
How is Cancellation Rate calculated?
Cancellation Rate = Seller-cancelled orders ÷ Total orders in the measurement period × 100
Example:
Suppose a seller receives 400 seller-fulfilled orders. Eight orders are cancelled by the seller or automatically cancelled under the applicable rules.
Cancellation Rate = (8 ÷ 400) × 100
Cancellation Rate = 2%
This reaches the general threshold that Amazon India recommends sellers stay below.
What causes a high cancellation rate?
The most common reasons include:
- Product is out of stock.
- Inventory quantity is not updated.
- Seller receives orders for unavailable products.
- Product price is incorrect.
- Seller cannot fulfil orders within the required timeline.
- Inventory synchronization fails across multiple marketplaces.
- Orders are not processed before the applicable cancellation deadline.
How to reduce Amazon Cancellation Rate
1. Update inventory regularly
Maintain accurate stock quantities in Seller Central. If a product is unavailable, update its inventory instead of accepting orders that cannot be fulfilled.
2. Synchronize inventory across marketplaces
If you sell on Amazon, Flipkart, Meesho, and other platforms, stock should be updated consistently to prevent overselling.
3. Monitor high-demand products
Fast-selling products need closer inventory monitoring, especially during sales events.
4. Check pricing before activating listings
Incorrect product prices can create operational and commercial problems. Verify prices before making offers available.
5. Review pending orders
Check orders regularly and process them within the required timelines.
6. Use the correct cancellation reason
If an order genuinely cannot be fulfilled, follow Amazon's cancellation process and choose the accurate reason. Do not ask customers to cancel orders through messages to avoid a seller cancellation.
Do buyer cancellations affect the seller's cancellation rate?
Amazon excludes certain cancellations initiated through the buyer's official cancellation option, provided the seller processes them using the applicable buyer-cancelled reason.
However, a buyer simply asking the seller to cancel through a message is not necessarily treated the same way.
Always follow the official cancellation workflow and review the cancellation report to understand which orders are affecting your metric.
6. Amazon ODR vs Late Shipment Rate vs Cancellation Rate
Many sellers confuse these three metrics because they all relate to account performance.
However, their definitions and causes are different.
ComparisonODRLate Shipment RateCancellation RateFull formOrder Defect RateLate Shipment RatePre-Fulfilment Cancellation RateMeasuresCustomer-service defectsLate shipment confirmationsSeller-fulfilled cancellationsMain causesNegative feedback, A-to-z claims, chargebacksDispatch and confirmation delaysStockouts and fulfilment failuresMeasurement periodRolling 60 days10-day and 30-day periods7-day and 30-day periodsApplies toRelevant orders across fulfilment typesSeller-fulfilled ordersSeller-fulfilled ordersGeneral targetBelow 1%Below 2% recommendedBelow 2% recommended
These are general Amazon India seller-performance references. Programme-specific requirements can be stricter.
7. What Are the Acceptable Amazon Account Health Targets?
Sellers should understand the general performance recommendations before planning their daily operations.
Performance metricGeneral Amazon India guidanceOrder Defect RateBelow 1%Late Shipment RateBelow 2% recommendedCancellation RateBelow 2% recommended
Are these targets the same for every seller?
No.
Amazon may apply stricter requirements to specific programmes, including Prime and Guaranteed Delivery.
For example, Amazon's India documentation specifies lower thresholds for certain Guaranteed Delivery and Easy Ship programme requirements.
Therefore, sellers should not assume that meeting general performance recommendations automatically means they meet every programme's eligibility requirements.
Best practice: Always check the metric targets displayed in your own Seller Central account and the policy applicable to your fulfilment programme.
8. How to Check Amazon Account Health in Seller Central
Sellers should regularly monitor their account health instead of waiting for an account warning.
Follow these steps:
- Log in to Amazon Seller Central.
- Open the Performance section.
- Select Account Health.
- Review your Account Health Rating.
- Check the Policy Compliance section for open violations.
- Review Customer Service Performance and ODR.
- Open Shipping Performance to review Late Shipment Rate and Cancellation Rate.
- Select the relevant metric to view details.
- Download the available performance report.
- Identify affected orders and take corrective action.
What should you review in the dashboard?
Dashboard areaWhat to checkAccount Health RatingOverall AHR score and statusPolicy ComplianceOpen policy violations and warningsCustomer Service PerformanceODR and its componentsShipping PerformanceLate Shipment Rate and Cancellation RatePerformance reportsOrders affecting specific metrics
The reports are especially useful because they help you identify which orders are contributing to a performance problem.
9. What Happens If Amazon Account Health Becomes Poor?
The consequences depend on the type and severity of the issue.
Possible outcomes include:
- Performance warnings.
- Requests for additional information.
- Restrictions on seller-fulfilled offers.
- Loss of eligibility for certain selling programmes.
- Account deactivation in serious or unresolved cases.
A low AHR score can indicate a risk of deactivation because of policy violations.
A performance metric exceeding its target can also lead to enforcement action under the relevant performance policy.
A healthy AHR does not guarantee that an account can never be deactivated. Amazon may take action for serious policy violations or other reasons outside the policies included in AHR.
10. How to Improve Amazon Account Health Rating
If your AHR is low or your account shows unresolved issues, take a structured approach.
Step 1: Identify the exact violation
Open Account Health and review the notification carefully.
Understand whether the problem relates to:
- Product authenticity.
- Intellectual property.
- Restricted products.
- Product safety or compliance.
- Listing policy violations.
- Other applicable Amazon selling policies.
Do not assume that every account health issue is caused by ODR or shipping performance.
Step 2: Prioritize serious violations
Amazon categorizes violations according to severity.
Address critical and high-severity issues urgently and follow the specific instructions displayed in Seller Central.
Step 3: Submit accurate evidence
If Amazon requests documents or an appeal, provide relevant and genuine evidence.
Depending on the issue, this may include:
- Supplier invoices.
- Brand authorization documents.
- Product compliance certificates.
- Product photographs.
- Quality-control records.
- Other documents specifically requested by Amazon.
Never submit altered or fabricated documents.
Step 4: Correct the underlying problem
An appeal should explain what happened and what has changed.
For example, if the problem is related to product authenticity documentation, review your sourcing and invoice verification process rather than simply promising that the issue will not happen again.
Step 5: Monitor the updated status
After addressing a violation, check whether Amazon has accepted the appeal or marked the issue as resolved.
Amazon's help information states that the AHR can update within a few hours after it confirms that violations have been addressed.
Step 6: Prevent repeat violations
Repeated violations of the same policy can have a greater impact on AHR. Maintain a compliance checklist and review new policy notifications regularly.
